National Rural Utilities sells $25-par notes; Duke Energy improves; KeyCorp strengthens

By James McCandless

San Antonio, April 29 – Activity in the primary preferred market served as the backdrop for positive secondary movement.

National Rural Utilities Cooperative Finance Corp. priced a $250 million offering of $25-par 5.5% junior subordinated notes due May 15, 2064 at par.

Leading in the secondary, Duke Energy Corp.’s 5.75% series A cumulative redeemable perpetual preferred stock improved.

Meanwhile, in banking and finance, KeyCorp’s recent 5.625% series G non-cumulative redeemable preferreds were also gaining.

Sector peer JPMorgan Chase & Co.’s 5.75% series DD and 6.125% series Y non-cumulative preferred stock closed mixed.

Regions Financial Corp.’s recent 5.7% series C fixed-to-floating rate non-cumulative perpetual preferred stock trended lower.

Oil and gas name Energy Transfer Operating, LP’s 7.375% series C fixed-to-floating rate cumulative redeemable perpetual preferred units rose slightly.

National Rural’s deal

In primary activity, National Rural Utilities priced a $250 million offering of $25-par 5.5% junior subordinated notes (A3/BBB+/BBB+) due May 15, 2064 at par.

There is no greenshoe.

The deal was announced Monday morning.

J.P. Morgan Securities LLC and RBC Capital Markets, LLC are the joint bookrunners.

The notes are redeemable after May 15, 2024 at par. Prior to that, they are redeemable by the company at any time, or within 90 days after a tax event or ratings agency event.

Duke Energy improves

In the secondary market, Duke Energy’s 5.75% series A cumulative redeemable perpetual preferred stock improved.

The preferreds (NYSE: DUKPrA) were up 7 cents to close at $26.00 on volume of about 1 million shares.

On Friday, the preferreds jumped up 13 cents.

KeyCorp gains

Meanwhile, KeyCorp’s recent 5.625% series G non-cumulative redeemable preferreds were also gaining.

The preferreds, trading under the temporary symbol “KEYLL,” added 7 cents to close at $24.99 with about 850,000 shares trading.

On Friday, the preferreds improved by 2 cents.

Elsewhere, JPMorgan’s 5.75% series DD and 6.125% series Y non-cumulative preferred stock were both active but closed mixed.

The series DD preferreds (NYSE: JPMPrD) moved up 8 cents to close at $26.65 on volume of about 553,000 shares.

On Friday, the preferreds garnered 17 cents.

The series Y preferreds (NYSE: JPMPrF) lost 9 cents to close at $25.80 on volume of about 500,000 shares.

Regions Financial’s recent 5.7% series C fixed-to-floating rate non-cumulative perpetual preferred stock also struck a negative trend.

The preferreds, trading under the temporary symbol “RXFCL,” fell by 4 cents to close at $25.40 with about 230,000 shares trading.

On Friday, the preferreds rose 12 cents.

Energy Transfer rises

In the oil and gas space, Energy Transfer’s 7.375% series C fixed-to-floating rate cumulative redeemable perpetual preferred units rose slightly.

The preferreds (NYSE: ETPPrC) were up 1 cent to close at $24.93 on volume of about 658,000 shares.

Indexes up

The Wells Fargo Hybrid & Preferred Securities Financial index finished Monday up 0.24%, doubling the 0.12% gain in early activity.

The iShares US Preferred Stock ETF was up 3 cents to $36.61.

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